DOB: News Bulletin 1974 - December 21, 2001

The Department of Banking News Bulletin

Bulletin # 1974
Week Ending December 21, 2001

This bulletin constitutes the only official notification you will receive from this office concerning any of the following applications. Any observations you may have are solicited. Any comments should be in writing to John P. Burke, Commissioner of Banking, at the Connecticut Department of Banking, 260 Constitution Plaza, Hartford, CT 06103-1800 or via E-mail to john.burke@ct.gov. Written comments will be considered only if they are received within ten days from the date of this bulletin.


STATE BANK ACTIVITY
Branch Activity

Section 36a-145 of the Connecticut General Statutes requires that each application for a branch, or for a limited branch at which loans will be made, be accompanied by a plan detailing how adequate services to meet the banking needs of all community residents will be provided. Plans are submitted when such applications are filed and are available for public inspection and comment at this Department for a period of 30 days. Questions concerning branch activity should be directed to the Bank Examination Division, (860) 240-8180.
Note: dates are listed in month/day/year format.

Date Bank Location Activity
12/19/01 Liberty Bank
Middletown
182 Highland Avenue
Cheshire, CT 06410
filed

CREDIT UNION DIVISION ACTIVITY
Mergers

On December 20, 2001, pursuant to Section 36a-470 of the Connecticut General Statutes, approval was granted to New Haven County Credit Union, Inc., New Haven, to merge New Haven Trolley & Bus Federal Credit Union, New Haven, with and into New Haven County Credit Union, Inc.

On December 20, 2001, pursuant to Section 36a-470 of the Connecticut General Statutes, approval was granted to Coca-Cola of Hartford Employees Credit Union, Inc., East Hartford, to merge with and into Community Healthcare Credit Union, Inc., Manchester.

CONSUMER CREDIT DIVISION ACTIVITY
Administrative Orders

On December 19, 2001, the Commissioner issued Findings of Fact, Conclusions of Law and Order, revoking the first mortgage license of First Bankers Mortgage Services, Inc., d/b/a FBMS, located at 1700 NW 64th Street, Suite 100, Fort Lauderdale, Florida. The agency's action was based on the fact that the entity failed to file a new bond or a replacement bond with the Commissioner as required by Section 36a-492 of the Connecticut General Statutes.

On December 19, 2001, the Commissioner issued Findings of Fact, Conclusions of Law and Order, revoking the first mortgage license of Charter Oak Financial Services LLC f/k/a Kresmasti LLC d/b/a ASG Financial Services, located at 227 Knickerbocker Ave., Stamford, Connecticut. The agency's action was based on the fact that the entity failed to pay to the Commissioner the required first mortgage broker license fee of $200 in violation of Section 36a-491 of the Connecticut General Statutes. In addition, the entity failed to file a new bond or a replacement bond with the Commissioner as required by Section 36a-492 of the Connecticut General Statutes.

On December 20, 2001, the Commissioner issued a Notice of Intent to Issue Order to Cease and Desist and Notice of Right to Hearing, against AAA Financial Corp., d/b/a AAA Financial Corporation, d/b/a Debt Eliminator, d/b/a Mortgage Savings Program, d/b/a Save! America!, d/b/a Mortgage Processing Dept, located at 9601 West Sample Road, Coral Springs, Florida. The agency's action was based on the assertion that the entity engaged in the business of debt adjustment in this state without a license, in violation of Section 36a-656 of the Connecticut General Statutes.

Stipulation of Settlement

On December 18, 2001, the Commissioner entered into a multi-state Stipulation of Settlement with respect to eHomeCredit Corp. d/b/a FHB Funding, a non-depository First Mortgage Lender located at 211 Station Road, Mineola, NY 11501. Pursuant to the Stipulation of Settlement, eHomeCredit Corp. agreed to pay $4,965.00 in restitution to consumers in Connecticut. The restitution is for fees paid by consumers that were not refunded, as required by law.

SECURITIES AND BUSINESS INVESTMENTS DIVISION ACTIVITY
Broker-dealer Registration Revoked for Failure to Pay Fine

On December 19, 2001, the Commissioner entered an Order Revoking Registration as Broker-dealer with respect to First Providence Financial Group, LLC of 90 Broad Street, 10th Floor, New York, New York.

First Providence Financial Group, LLC had been the subject of a November 27, 2000 Corrected Final Decision and Final Order fining the firm $30,000 for violating the Connecticut Uniform Securities Act. Since the respondent failed to pay the $30,000 fine within the prescribed time period, the Commissioner issued a Notice of Intent to Revoke Registration as Broker-dealer, Notice of Intent to Fine and Notice of Right to Hearing on January 3, 2001. Ensuing litigation resulted in the Superior Court for the Judicial District of New Britain (Administrative Appeals Court) issuing a November 15, 2001 Memorandum of Decision holding that the firm violated Sections 36b-14(d) and 36b-15(a)(2)(H) of the Connecticut Uniform Securities Act as well as Section 36b-31-6f(b) of the Regulations under the Act (First Providence Financial Group, LLC v. John P. Burke et al., Docket No. CV-01-506208S).

On December 5, 2001, the Commissioner entered into a Settlement Agreement with the respondent. Pursuant to the Settlement Agreement, the respondent paid a $20,000 fine to the Office of the Attorney General, acting on behalf of the Commissioner, and agreed not to contest the revocation of its broker-dealer registration in Connecticut. The firm's broker-dealer registration was formally revoked on December 19, 2001. Also on December 19, 2001, the Commissioner issued an Order withdrawing the January 3, 2001 Notice of Intent to Fine.

Broker-dealer Applicant Assessed $13,100
for Unregistered Broker-dealer Activity

On December 19, 2001, the Commissioner entered a Consent Order with respect to The Seidler Companies, Inc., an applicant for broker-dealer registration located at 515 South Figueroa Street, Suite 1100, Los Angeles, California. The Commissioner maintained that the firm's broker-dealer registration had disclosed, and the department's investigation confirmed, that at various times from 1996 to 2000, the firm had serviced five or fewer individual accounts and several institutional and corporate accounts in Connecticut at a time when neither the firm nor the agents were registered under the Connecticut Uniform Securities Act.

The Consent Order required that the firm pay $13,100 to the department. Of that amount, $10,000 constituted an administrative fine, $2,100 represented reimbursement for past due registration fees, and $1,000 constituted reimbursement for agency investigative costs. The Consent Order also mandated that the firm implement revised supervisory and compliance procedures designed to improve the monitoring of state broker-dealer and agent licensing requirements. In addition, the Consent Order obligated the firm to file quarterly reports for two years concerning any securities-related complaints, actions or proceedings involving Connecticut residents.

The firm became registered as a broker-dealer in Connecticut on December 19, 2001.

Electronic Trading Group Assessed $7,500
for Unregistered Branch Activity

On December 19, 2001, the Commissioner entered into a Stipulation and Agreement with Electronic Trading Group, L.L.C. a/k/a ETG, L.L.C., a Connecticut-registered broker-dealer having its principal office located at 111 Broadway, New York, New York. The Stipulation and Agreement alleged that (1) from approximately 1998 to January 2001, the firm transacted business from 440 Main Street in Ridgefield prior to that location being registered as a branch office under the Connecticut Uniform Securities Act; (2) the firm continued to transact business from the site notwithstanding more than one written notice by the department that such conduct could be construed as a wilful violation of the Act; and (3) from approximately 1998 through April 2001, the firm knowingly employed unregistered agents from the Ridgefield office in alleged contravention of Section 36b-6(b) of the Act.

The Stipulation and Agreement required that the firm pay $7,500 to the department. Of that amount, $5,000 constituted an administrative fine, $750 represented reimbursement for past due registration fees; and $1,750 represented reimbursement for agency investigative costs. The Stipulation and Agreement also required that the firm revise and implement supervisory and compliance procedures designed to prevent and detect violations of the branch office registration provisions of the Connecticut Uniform Securities Act and its regulations.

Dated: Thursday, December 27, 2001

John P. Burke
Banking Commissioner